Many companies buy products made by cheap labor overseas, right? Heck,
that Dateline report Friday night mentioned that that factory in Bangladesh with such terrible working conditions made clothes for Sears and Kohls too. So why pick on Wal-Mart? Why should they be singled out for the labor policies of their suppliers and other companies get a pass? These are reasonable questions.
Fortunately, the National Labor Committee (which helped NBC do its expose) has a new report out that answers such questions while simultaneously gutting Wal-Mart's excuses like a fish. You can get it here (in .pdf format). It's well-worth reading the whole thing, but I'll go straight to the conclusions:
Wal-Mart is the largest producer in Bangladesh....
If Wal-Mart has its way, the workerts in Bangladesh are about to be driven even deeper into misery. Fortune Asia reported on May 16, 2005 that,
"In January, Wal-Mart and other retailers demanded that exporters cut prices by 12 percent or find themselves without new orders." On top of that, Wal-Mart wants its Bangladeshi contractors to
start paying for "any duties imposed by importing nations," which in the case of the U.S. ranges from 18 to 22 percent. The workers in Bangladesh could see their wages, already at starvation level, plummet by another 34 percent. A young woman sewing Wal-Mart garments for 13 cents an hour may soon find herself earning just 8.5 cents an hour.
[emphasis in original for all quotations]
Here's the NLC on benefits:
Over a year ago, we asked Wal-Mart to sign a simple pledge that any woman sewing Wal-Mart garments in Bangladesh finally receive her legal right to three months maternity leave with full pay. We are talking about maternity benefits of as little as $27 a month, $81 for the entire three months. To date, 22 companies have signed the pledge, including Costco, Sears/Kmart,PVH, Levi Strauss, Gap, Liz Claiborne, H&M and many others. Wal-Mart alone refuses to sign the pledge...
Wal-Mart also penny-pinches their suppliers more than other companies are:
Every factory owner we spoke with told us that,
"Wal-Mart is always driving down and squeezing prices, especially lately," despite the fact that
"our overhead isn't coming down and living costs are going up." Wal-Mart is
"cheap, cheap, cheap," one owner told us. And Wal-Mart no longer negotiates, it says
"Take it or leave it." This we heard repeatedly....
Producing for Wal-Mart, the only way a contractor can stay in business is to keep lowering wages and benefits. It is not a great mystery. This is Wal-Mart's business model. As the largest company in the world, it uses its enormous power to constantly drive down wages and prices. When a factory cannot cut any further, Wal-Mart pulls up stakes and moves elsewhere, to places like Vietnam and China.
Once again, I am not suggesting that all companies stop importing merchandise. That's impossible and economically unwise. What we can insist upon is that American companies follow their own ethical codes. It should be easy to demonstrate that Wal-Mart doesn't, because, as Dateline and the NLC found out, it's easy to see if you bother looking.
JR